Taiwan June exports mark worst fall in 14 years on weak China, US demand
2023.07.07 05:27
© Reuters. A cargo ship is pictured at a port in Keelung, Taiwan, January 7, 2022. REUTERS/Ann Wang
By Roger Tung and Faith Hung
TAIPEI (Reuters) – Taiwan’s exports fell more than expected in June, clocking their worst decline in almost 14 years, as the island struggled with persistent weakness in demand from the U.S. and China for its tech products as well as a dour outlook.
June exports plunged 23.4% in value on the year to $32.32 billion, the finance ministry said on Friday, marking the 10th consecutive month of decline. That was worse than a fall of 14.1% in May and missed a Reuters poll forecast for a 13.35% contraction.
Taiwan’s export-reliant economy will probably grow more slowly in 2023 than previously forecast, the government has said, as first-quarter GDP fell by a revised 2.87% year-on-year, slipping into recession and notching its worst performance since 2009.
Total shipments of electronic components in June fell 21.3% from the year before to $13.58 billion, with semiconductor exports down 20.8%, it said.
The outlook remains dim, the ministry said on Friday, adding that it expected exports in July to drop between 16% and 19.5% on year and forecasting “considerable pressure” on foreign trade from global interest rate rises to control inflation and broad global economic uncertainty.
The government has said a recovery in exports may not occur until September at the earliest or as late as November as orders pick up for the traditionally busy Christmas season.
Taiwanese firms such as TSMC, the world’s largest contract chipmaker, are major suppliers to Apple Inc (NASDAQ:), Nvidia (NASDAQ:) and other global tech giants, besides providing chips for auto companies and lower-end consumer goods.
United Microelectronics Corp, a smaller competitor of TSMC’s, reported on Thursday that June sales dropped 23.2% on the year.
At $11.99 billion in June, Taiwan’s exports to China were down 22.2% from a year earlier, after the prior month’s drop of 19.4%.
Exports to the United States fell 25.2% in June, after slipping an annual 3.5% in May.
Taiwan’s June imports, often seen as a leading indicator of re-exports of finished products, dropped 29.9% to $26.36 billion. That compared with economists’ forecast of a 16.7% fall and a 21.7% decline in May.
